Living and working in a foreign country is not easy. While it may provide you with opportunities to meet new people, network and grow your career, you will have to pay high rental rates and operate on a different set of rules especially when it comes to long term loans. If you would like to buy a house to live in or rent in the UK, you will discover that the vast majority of mortgage companies may not be willing to approve your mortgage because you can go back to your home country at any time. The good news is that there are some mortgage companies that offer UK mortgages for expats.
How to Qualify for a UK Expat Mortgage
Obviously, you must be a legal resident in the UK with a long term contract to work in the UK. You must be an adult with a regular income source and a good credit rating. These are the basic requirements. Other requirements include; a downpayment, which is usually a percentage of the purchase price. This can be 5-20%, but there are a few lenders offering 100% financing. Another factor that you should be aware of is that some lenders only finance the purchase of rental property, not personal property. This is because they want a regular source of income they can count on in case you default. Some lenders can approve mortgages for personal residences, but they may ask for a bigger downpayment. Most lenders normally approve mortgages for marketable properties that are located in prime locations as it will be much easier to offload the property if and when the borrower defaults on the mortgage payments.
When looking for a mortgage to help you buy property in the UK, the following are key factors to consider:
i) Interest Rates
This is the cost of borrowing, so it is the most important factor to consider when looking for a mortgage lender. Ideally, you should ask different lenders to give you a quote on the interest rates they are likely to charge you if you applied for a mortgage for expats. Obviously, the most affordable lender should be chosen. Be sure to ask for a fixed rate mortgage to ensure your payments do not rise when economic conditions take a downward turn.
ii) Deposit Required
The amount of money that a lender requires you to pay as deposit towards the purchase of the property is a key factor to consider. If you only have ten thousand pounds to spare, the ideal lender should accept that amount. The term of the loan is a key factor to consider as you may want affordable monthly payments.
